Tenants are looking, while investors are waiting to see which way the wind blows

Here’s what Rightmove’s latest commercial data tells us about supply and demand

By Tom Entwistle, LandlordZONE

According to new data from Rightmove, businesses are still looking to rent premises, but investors, it seems, are sitting on their hands. That is the clear message from Rightmove’s Commercial Insights Tracker for the third quarter of 2026. Their research indicates that leasing enquiries are rising in every main commercial sector while investment enquiries are falling in three of the four main sectors.

Comparing the figures with the same quarter last year, enquiries to lease offices have risen by 2 per cent, industrial by 6 per cent, leisure by 3 per cent and retail by 1 per cent. 

However, on investment, office enquiries from investors, according to Rightmove’s statistics, slipped by 1 per cent, but retail was significant at 7 per cent, as was leisure at 11 per cent. The main exception was industrial, which grew on both measures, with the sector attracting both letting enquiries and investment enquiries, both up by 7 per cent. 

Rightmove’s figures cover Great Britain only. The upward-only rent review ban and the non-domestic MEES regime apply in England and Wales. The business rates multipliers and empty property rules apply in England; Wales and Scotland have their own rules. This article is for general information only and does not constitute legal, tax or financial advice. Landlords should take professional advice for their own circumstances before acting.

Why are occupiers moving while investors are not?

Rightmove’s Commercial Director, Louise Sedgwick, makes the point that a business’s requirements for space are difficult to delay. Their lease comes to an end, the firm grows, or its premises are no longer suited to the way it works. The current economic uncertainty may have an effect on how much space the business takes, where and at what cost, but it does not remove the business property needs. 

On the other hand, an investor is not under the same immediate pressure. As Louise Sedgwick puts it, “An investor considering an acquisition can often wait.”

Given the state of the UK economy and budget uncertainty, investors currently have good reason to wait. A year ago, falling interest rates were drawing them in with everything pointing to an investment revival. 

Rightmove’s Q3 2025 tracker showed investment enquiries up 11 per cent year on year as bank rate cuts took effect. That support has now gone. At its September meeting, the Bank of England Monetary Policy Committee held the bank rate at 3.75 per cent, with three of the nine Monetary Policy Committee members voting for a rise to 4 per cent. 

CPI inflation was 3.1 per cent in August, and the Bank expects it to continue its rise further as higher energy costs feed through the system, and its own figures now show it has moved to 3.5 per cent. With the next decision on bank rate due on 5 November, the conversation has shifted. No longer is a rate fall expected; rather, it is more likely the next MPC meeting will bring a rise in the Bank Bate. 

What do these figures tell us?

A word of caution. Rightmove measures demand enquiries to agents about properties listed on its site. It measures supply as the number of listings, adjusted for growth in its customer base. These are enquiries, not completed deals, and listings are just that, a listing rather than size and square footage. 

Rightmove itself acknowledges there are different ways of measuring the market as some others do, and as a listing’s portal, Rightmove understandably has an interest in the commercial market being seen as active.

Transaction data tells a nuanced story. CBRE reports that the UK attracted €16.2bn of real estate investment in Q3 2026, 5 per cent more than a year earlier and 22 per cent more than in the previous quarter. 

There is no doubt deals are still being done. What appears to have cooled is the wider pool of enquiring buyers. There are some dramatic local figures, such as office leasing demand in Wandsworth, which according to CBRE is up 112 per cent. These could be isolated cases and are best treated with care.

Plenty of office space, not much of it suitable 

The standout figure in Rightmove’s release is on office supply listings available to lease rose by 17 per cent year-on-year, that’s against a 2 per cent rise in demand, indicating the widest gap of any sector.

Louise Sedgwick’s reading of the situation is that this is not a simple surplus. There are more offices on the market, but many do not suit the new business requirements for how businesses now operate today. So, occupiers are often competing for a small pool of good-quality space. 

Other credible research points the same way. The RICS Commercial Property Monitor for Q2 2026 found surveyors are expecting secondary office rents to fall over the coming year, while they expect prime (quality office space) rents to rise. Cushman & Wakefield’s regional office data also points to Grade A space accounting for 74 per cent of office take-up.

For the smaller landlord, the lesson here is uncomfortable but very clear. Much of the extra office supply is older, poorly specified and less efficient workspace. This is the space that tenants are passing over. 

Aman Parmar of BizSpace, a flexible workspace provider with an obvious interest in this view, says occupiers are using their wider choice to select quality and certainty. They want space they can move into right away, and on lease terms that, in an uncertain world, won’t tie them down for too many years.

London, the premier office market in the UK, shows a patchy picture. Office leasing demand has risen by 13 per cent in Southwark, it’s fallen away by 17 per cent in Islington, 19 per cent in Hammersmith and Fulham and 12 per cent in the City of London. 

The bright spot is in industrial

Industrial leasing demand rose in nine of Rightmove’s 11 regions, led by Scotland (+18 per cent), Wales (+15 per cent), the South East (+12 per cent), London (+11 per cent) and the South West (+10 per cent). 

Supply rose too, by 16 per cent overall, but the shortage that matters most to small-scale landlords is at the smaller end of the industrial property market. Research by Savills and Potter Space found there’s been a decade of undersupply of industrial units below 100,000 sq. ft. 

They have estimated that meeting this pent-up demand could have supported 48,000 jobs between 2014 and 2024. Savills’ latest figures also show that the supply of prime mid-sized industrial units is down by around 4 per cent over a year earlier.

Interestingly, there are two new sources of demand coming into play. The government’s Defence Investment Plan published in June has resulted in Savills estimating that higher defence spending could generate up to 32 sq. ft. of additional industrial and logistics space demand over the next seven years. 

Meanwhile, data centres are competing with logistics operators for the same land and critically, grid connections. Louise Sedgwick sees both uses as opportunities for owners who can offer suitable premises or sites. There are caveats, though. Defence-related demand is likely to cluster around established defence and aerospace centres and data centres need access to large quantities of energy and water. 

Retail and leisure

Retail leasing enquiries have barely moved, according to Rightmove (+1 per cent), while investment enquiries fell by 7 per cent. Leisure investment enquiries dropped 11 per cent, the sharpest fall in the Rightmove press release. Regionally the picture is quite uneven. 

Leisure leasing demand rose 27 per cent in the East Midlands and 26 per cent in the South East. But it fell 22 per cent in the East of England, while retail leasing demand fell 20 per cent in the Northeast and 10 per cent in Wales.

Smaller high-street occupiers in England have had some help from the April 2026 business rates announcement. The old 40 per cent retail, hospitality and leisure relief has been replaced with permanently lower multipliers of 38.2p and 43p for qualifying properties with a rateable value below £500,000, while properties at £500,000 and above now pay a considerably higher rate of 50.8p.

Policy changes in the background

Three new regulatory developments help explain why commercial property investors are being cautious. All three of these should be considered in small-scale commercial landlords’ plans.

The English Devolution and Community Empowerment Act 2026, which received Royal Assent on 29 April, will ban upward-only rent reviews. This applies to new and renewal business leases in England and Wales. The legislation inserts new Schedules 7A and 7B into the Landlord and Tenant Act 1954. 

This ban awaits commencement regulations and is not expected to be in force before 2027, but renewal arrangements entered from 17 March 2026 are already caught in its trap. I cover the detail in my article, “End of upward-only rent reviews: what does it mean for landlords"? The point here is that investors now face less certain future income, and their pricing should reflect that.

The second important change is the government’s interim response on commercial minimum energy efficiency standards (MEES). Details were published on 18 June, confirming that privately rented non-domestic buildings over 1,000 sq. m. will need an EPC rating of B from 2031. This is when cost-effectiveness is achieved, and the legislation drops the previously proposed EPC C milestone in 2027. 

Buildings below 1,000 sq. m. can stay at the current EPC minimum. Most small landlords will therefore escape the tougher target, for the foreseeable future. However, they should bear in mind that tenants increasingly choose energy-efficient commercial space when it comes to taking on a new lease. 

Third, empty rates are an issue. When a property falls vacant, the business rate-free period lasts just three months for offices and shops and six months for industrial premises. After that, the owner normally pays full business rates. With office supply rising, it hardly gives much time to find a new tenant, and holding out for the perfect tenant can quickly become very expensive.

A final word 

The underlying message of Rightmove’s figures is encouraging for the commercial property market in the UK. Businesses still need premises, and many are actively searching for new space. 

But with demand rising faster than supply, the advantage lies with the landlord providing their property that meets modern requirements. Aberdeen Investments’ view is that income, rather than capital growth, is now the main driver of property returns. For small commercial landlords, that makes securing and keeping good tenants a top priority.

Landlords offering the quality, flexibility and certainty occupiers want will let their space faster. Those relying on the old landlord-friendly terms may find that both tenants and the law are moving against them.

[Main image credit: Mike Bird]